YouSaid · the spoken record

Scott Page

lines on the record: 90
first: 2019-04-02
most recent: 2019-04-02
sittings or episodes: 1
sources: podcast

Every line below is reproduced as it was said and linked to the record it came from. Nothing here is summarised or generated. Directory · Search · Corrections

“Going to work. So when you're in seventh grade, we're teaching you very simple things and we're trying to teach you that there's some structure to the world. And so we want to say, look, here's the power of these physics models. They explain not only explain things that you see every day, like why objects fall to the floor, they also sort of explain things that you wouldn't have predicted beforehand, like the two things of different weight follow the exact same time. Or they can predict things like the existence of the planet Uranus, right, which they didn't know was out there. So you get...”
2019-04-02 · The Knowledge Project with Shane Parrish · #55 Scott Page: Becoming a Model Thinker · IDENTIFIED FROM THE TRANSCRIPT
“Think it was right when we had a much simpler world, right? I think it was right when we thought let's get taken in the context of a business decision. Like you might think, okay, here's how you make it a business decision. You figure out what the cost is going to be. And then you think about the net inflow of profits. And you think, okay, did the profits outweigh the cost, right? Revenues outweigh the cost, right? Is it going to be positive cash flow? Now when you make a business decision, there's a recognition that there's environmental impact. There's an understanding that it's going to affect your ability to attract talent, right? Because it's going to be an interesting problem. There's a question of how does that position you strategically for the long run? There's a question of what it does for your capacity. There's a question of what it does for your brand. And so these decisions are just so much more complex than they were. There's so much, just an increased awareness of the complexity of all these decisions that there's no single models.”
2019-04-02 · The Knowledge Project with Shane Parrish · #55 Scott Page: Becoming a Model Thinker · IDENTIFIED FROM THE TRANSCRIPT
“Across these different institutional forms. That's a question you can't touch really with ironning regressions necessarily other than to identify the places where it's not working. But you can use models to help you kind of think through what if we made this a market, right? What if we made this a democracy? What if we handed this out to an algorithm?”
2019-04-02 · The Knowledge Project with Shane Parrish · #55 Scott Page: Becoming a Model Thinker · IDENTIFIED FROM THE TRANSCRIPT
“Democracy's algorithms and ecologies. We can sort of say, look at all the stuff we have to do. We used to sort of think, okay, look, we can use markets, hierarchies, democracies, or just kind of let her go, right? You see what happens. Like with the roads, we just kind of let it go. You decide to go somewhere. I decide to go somewhere. And then it's a total mess for the most part, right? But when we made these decisions about where we have markets, hierarchies and democracies, that was made in a world where there was no data, no information technology, where we were exchanging beads as opposed to setting bits through the mail. But now there's this fifth thing, right? There's these algorithms. And a lot of stuff, a lot of things can be done by algorithms as opposed to markets, hierarchies, and democracies. And there's a question because the cost of change for all these institutions, should we reallocating problems, right?”
2019-04-02 · The Knowledge Project with Shane Parrish · #55 Scott Page: Becoming a Model Thinker · IDENTIFIED FROM THE TRANSCRIPT
“Better. So if you look at the American government at the moment, it's kind of a mess. Everything from like sort of gerrymandering to the fact that, you know, we have this electoral college that made a lot of sense when states are all equal sized or roughly equal sized. Now some states that are tiny and still have the same number of senators as states that have 50 times as many people. But even how we vote on things, what lies under the purview of Congress? Like why do we have a separate in some sense like a financial system you think of like the Federal Open Market Committee and the Federal Reserve System, that's quasi-governmental. The FDIC is quasi-governmental. But NASA and the NIH are not quite as quasi-governmental. There's a deep question about what institutions we use where that is underappreciated. So Javis and Jenna Bednar and JJ Prescott and are running a thing in February here at Michigan called Markets Hierarchies.”
2019-04-02 · The Knowledge Project with Shane Parrish · #55 Scott Page: Becoming a Model Thinker · IDENTIFIED FROM THE TRANSCRIPT
“There's so much data, there's this huge shift toward empirical research. If you count the number of papers in the leading journals that are empirical versus theoretical, there's been this massive shift towards empirical research, which in some senses, you know, I applaud it the work is much better, right? There's much more data. We can get at causality. Huge fan of it. But I think there's a cost to that because what a lot of that empiric work is doing is really nailing down exactly what's the size of this effect, what's the slope of that line, what's the size of the coefficient, how significant is it? And so we can suss out whether improving teacher quality matters more than reducing class size and by exactly how much, right? So that's great. I'm all for it. However, that's taking the world as it is. And one of the really cool things about models, I was trained by these people who did mechanism design is thinking about can we, based on our understanding of how people act, redefine the world, construct mechanisms and institutions that work.”
2019-04-02 · The Knowledge Project with Shane Parrish · #55 Scott Page: Becoming a Model Thinker · IDENTIFIED FROM THE TRANSCRIPT
“Electrons could decide on their own laws of physics. So if you're running a large organization, or if you're a Secretary of the Treasury, or if you're in any sort of policy position, you get to decide the laws of physics. You get to decide what's legal, what's not legal, what the strategy space is. So when you think about, when you're saying when someone constructs the model, what do they decide their assumptions on? One of the things you have to keep in mind is one reason people construct models is to build things, right? To build buildings, to build policies, to build strategies. When you do that, you're defining in some sense the state space. You're defining reality. So if you tell your traders, you're looking at these ratios, you're defining the game for them, right? And so I think that design aspect of models is often overlooked, right? Underappreciated. So within the field, I mean, I'm in sort of an economics, political, science, business, whatever,”
2019-04-02 · The Knowledge Project with Shane Parrish · #55 Scott Page: Becoming a Model Thinker · IDENTIFIED FROM THE TRANSCRIPT
“Oh, absolutely. No, I think models force you to get the logic right. They force you to sort of say what really matters here in terms of driving people's behaviors or firms' behaviors, how do those behaviors interact in terms of how do they aggregate? And then how should people respond to that? There's a famous quote by Murray Gelmod where he said, imagine how hard physics would be if electrons could think, right? And I'd written in a paper and I because it was attributed to Marie. And someone said, I don't think Marie's ever said that. And so I went to Murray and I said, Murray, have you ever said this? And he read it. And so then he just said, imagine how difficult physics would be if electrons could think, right? And so he goes, there, I've said it. You're safe. But one of the things about modeling it, especially like, I think in the space, a lot of your listeners are in because they're people who in some sense define the world. It's imagine how difficult physics would be if electrons could think and”
2019-04-02 · The Knowledge Project with Shane Parrish · #55 Scott Page: Becoming a Model Thinker · IDENTIFIED FROM THE TRANSCRIPT
“And so you get this idea that, and so when somebody's constructing a model, oftentimes they'll say, well, I'm a systems thinker. And then if you have them write down their model, you'll say, wait a minute, that's a markoff model. That is a unique equilibrium. Do you think your system has a unique equilibrium? They're like, no, no, it's very contingent, path dependent. And then you'll say, okay, well, then your model's got to be wrong, right? I mean, you're missing something. There's got to be some way of changing these transition probably. So I think that I view it as a very deliberative process within yourself of constructing a model, right? First you kind of ask, what is the general class of models? So there's a system, there's a decision, is it a game? And then once you write it down, then you can kind of go to the mathematics and the mathematics will often tell you, given your assumptions, what must be true about the world. And then if it's not, you can, you then have to kind of go back and say, well, let me rethink my model then, right?”
2019-04-02 · The Knowledge Project with Shane Parrish · #55 Scott Page: Becoming a Model Thinker · IDENTIFIED FROM THE TRANSCRIPT
“Great examples of this thing is, I think, the value of the formal mathematics is Markov model. So Markov model is there's a set of states that you could be happy, bored, sad, whatever, and then there's transitions between those states, right? Or a market could be volatile, not volatile, whatever. And then if those transition probabilities are fixed, and if it's possible to get from any state to any other state, then that system goes to an equilibrium. And it's a unique equilibrium. So what that means is history doesn't matter, right? One-time interventions don't matter. There's just this vortex drawing it to one thing. What that model forces you to do then is if you want to argue the world is complex, if you want to argue for path dependence, if you want to argue that a policy intervention is going to make a difference in some way, you then have to either be saying, I'm creating a new state that didn't exist before, or I'm fundamentally changing these transition probably.”
2019-04-02 · The Knowledge Project with Shane Parrish · #55 Scott Page: Becoming a Model Thinker · IDENTIFIED FROM THE TRANSCRIPT
“Your network really well. You want to seize opportunities, those sorts of things. But there's a circular reasoning in there in the sense that everybody followed that formula. It's not clear that everybody would be successful, right? And so the thing is oftentimes these systems contain feedbacks within them that make them logically inconsistent at the level of the whole. And in fact, his book, which is, again, it's a fabulous book. I'm not integrating with because I think he's right. And I think if you read his book, you'll be able to be more successful. But if everybody read his book, which he would like, then people wouldn't be successful. And so when you think about constructing a model, again, it depends on the context. You want to think through, is the whole thing sort of coherent? One of the things I love about moving, when you ask me the first question, like, what do I think of it was a mental model? I think of it as, again, and I'm a real outlier here. I think of it as like a way of saying, I'm going to use this mathematical model to make sense of reality.”
2019-04-02 · The Knowledge Project with Shane Parrish · #55 Scott Page: Becoming a Model Thinker · IDENTIFIED FROM THE TRANSCRIPT
“Or maybe suffering from some sort of human bias if it's a human, and then is it just a decision? Is it a game or is it some sort of social process? So those are sort of in some sense the two main questions. What context is the action taking place? Who's making it? And then I think the real interest challenge is if it's not a decision, if it's a game or if it's some sort of social process, is making yourself really aware of the challenges of aggregation, you know, in the sense that like oftentimes things don't add up the way they're supposed to, right? Or there can be just a fundamental paradox in the assumptions you're making. So for example, Barabasi has this fabulous new book out called The Formula. And in this book, the formula he talks about how these are the lessons for success by looking at tons and tons of data. And some of it is about some of the things we were talking about before with Goandes. You want to make sure you use.”
2019-04-02 · The Knowledge Project with Shane Parrish · #55 Scott Page: Becoming a Model Thinker · IDENTIFIED FROM THE TRANSCRIPT
“How are people here? Then you can ask yourself Is my logic correct? So Colin Cameron, Richard Thaler, people study behavioral economics would say if it's repeated a lot, that should move you a little bit more towards the rational behavior because people should learn. And if the stakes are huge, that should move you towards rational behavior. If it's being made by an organization versus an individual, that could move you in either way. If it's a big decision by an organization, you could imagine like, okay, this is going to be done rationally, right? Because you have a committee of people think about it in a very careful way. But if it's some sort of standard operating procedure within a large organization, then it could be way over the other extreme. This is just how we do it. This is how we've always done a vein. This is how we're always going to do it at Bain. So now you've got this idea of, okay, how do I'm thinking about, okay, how do I model the person following a rule or optimizing?”
2019-04-02 · The Knowledge Project with Shane Parrish · #55 Scott Page: Becoming a Model Thinker · IDENTIFIED FROM THE TRANSCRIPT
“Like making an individual sort of isolated choice by modeling a strategic situation over modeling something that's much more sort of socio-ecological like that. Second thing you want to ask is how rational is the person making the decision with the alternative not being irrational, but the alternative being sort of rule of thumb based. So there's a guy Geard Gigarenzer who's a German social scientist and Peter Todd of this book of this work on sort of adaptive toolboxes, you know, just this idea of like I've just got a set of sort of mental models or tools and I apply those kind of like oh this is problem A, I apply tool A. This is problem B. I approach tool B. So there's a lot of stuff when I think about like where I'm going to go do my laundry or what coffee shop I'm going to go to, but I probably don't sit around and rationally think about it. I just kind of like just follow some sort of routine and maybe I adapt that routine slowly. Maybe I learn a little bit, but for the most part I might just follow rules. So you want to ask.”
2019-04-02 · The Knowledge Project with Shane Parrish · #55 Scott Page: Becoming a Model Thinker · IDENTIFIED FROM THE TRANSCRIPT
“Yeah, so I think one of the first things you want to ask is who are the relevant actors, right? So, is this a single actor who's sort of just making a decision or is this a strategic situation where someone is taking an action and they've really got to take into account what the action is of someone else, what choice somebody else is going to take? So if you're thinking of like what action I'm going to have taken a soccer game, I'm going to take in investing. I've got to think a lot about what other people are doing. Or you might want to ask, is it the case that I'm taking some sort of action and I'm embedded in a much larger structure where things are sort of moving and I'm taking cues from that larger social system? So suppose I'm thinking about like which book do I buy? You can think of that as like or which album do I download. You can think of that as like, oh, it's just me making a decision, but it's not because you're really making that within a much larger sort of social cultural economic where you're not even maybe aware of the fact that you're drawing signals about what other people are doing, right? So you want to think about what am I moment a person?”
2019-04-02 · The Knowledge Project with Shane Parrish · #55 Scott Page: Becoming a Model Thinker · IDENTIFIED FROM THE TRANSCRIPT
“And so I think that what I'm trying to do in the book in some sense is the same thing that tool is trying to do in his work life. Here's a way to get kind of knee deep in these things to understand where they work. And no one is going to master all 30 models in these books because you could write a whole PhD on each one of them. You write 20 PhDs on each one. But the thing is, the awareness is really useful because you might say, you know, this Colonel Blotto game or these Markov models or these signaling models or these power law distributions, this is really interesting to me. And then you can go a little bit deeper. And so I think that it's really meant to be just kind of a reference in a way, but also just sort of an awareness document where you can sort of say, hey, wow, I was just looking in here's a super interesting model I'd never even heard of and it's really fun to think about.”
2019-04-02 · The Knowledge Project with Shane Parrish · #55 Scott Page: Becoming a Model Thinker · IDENTIFIED FROM THE TRANSCRIPT
“Variety of you. And it was just a great exercise was how do you write these in each one of these in seven to 12 pages in a way that everybody could understand them and then use them? And that's a real challenge. And the people at BASIC, Melissa Verna, who's my editor of the TJ Killer, who's editor of the book, but she was the person who said wordsmith this with me. That was a real challenge because there were times when she would just say no one is going to understand this. That was a fun thing to do. Pick up my book and pick up Markov models, for example, right? Markov models are these models where the states of the world and then transitions between the states. And you read the book. It's like, you know, about 10, 12 pages. And I think most people can understand it. And all the math is in a box. If you go to the Wikipedia page and you type in Markov publisher, you'll just go, wow, I should like get a PhD in statistics. That's your only hope of understanding.”
2019-04-02 · The Knowledge Project with Shane Parrish · #55 Scott Page: Becoming a Model Thinker · IDENTIFIED FROM THE TRANSCRIPT
“A little bit deeper, but also that variety of models gives you, I think, two things. One is it gives you sort of a robustness that you think of in sort of a portfolio sets that you're not going to make a mistake. But it also can give you this sort of incredible bonus in the sense that two models, rather than giving you the average of the performance of the two, often give you much, much better than the average, right? You get to sort of bonus from thinking about a variety of models. And so the book, what was super fun about the book and what's been really rewarding about it is what I do is I lay out this philosophy of like, okay, this is why to confront the complexity of the modern world, you need a variety of models, right? Sort of using this data information knowledge wisdom idea. Then what I do is I take what I think are the 30 most important models that you might know, Markov models, linear models, kernel blotto models, Lyapunov functions, systems dynamic models, simple signaling models from Hague, they're just a”
2019-04-02 · The Knowledge Project with Shane Parrish · #55 Scott Page: Becoming a Model Thinker · IDENTIFIED FROM THE TRANSCRIPT
“So, one of the things I talk about in both diversity bonus and also in the model thinkers, you could think of yourself as this toolbox. And you've got some capacity to accumulate tools, mental models, ways of thinking. And what you could decide to do is you could decide to go really deep. You could be the world's expert on, or one of the world experts on random forest mops or the Oppenoff functions, or you could be one of the world's leading practitioners of sort of signaling models in economics. Alternatively, what you could do is you could go deep on a handful of models. There could be three or four things you put together. Or you could sort of be someone who, I think in the financial space, I think a lot of people are really successful, like Bill Miller, a friend of mine, is by having just an awareness of a whole bunch of models, right? So having 20 models that you have at your disposal that you can think about. And then when you think, when you realize like, you know, this one may be important, then you dig.”
2019-04-02 · The Knowledge Project with Shane Parrish · #55 Scott Page: Becoming a Model Thinker · IDENTIFIED FROM THE TRANSCRIPT
“Think that's right, but I also think it's there becomes this interesting challenge when you think about building teams or also building your own careers. So your interview with Atul Gawande, he made this fabulous point about his method of making a contribution to the world was sort of being able to communicate across different types of people in different areas, right? So he brought sort of a, you know, he'd been trained by doctors. So he had, you know, his parents were doctors. And so he'd sort of absorbed what the medical profession was all about. But at the same time, he had these deep interest in science and this deep interest in sort of political philosophy and literature and sort of public policy. And that enabled him to fill what Ron Burt calls a structural hole, right? In terms of like there's a network of people studying medicine, there's a network of people studying sort of politics and public policy. And he can sort of stand between those two things and make sense of them.”
2019-04-02 · The Knowledge Project with Shane Parrish · #55 Scott Page: Becoming a Model Thinker · IDENTIFIED FROM THE TRANSCRIPT
“Environment changed, yeah. Right. No, that's the key thing the state, the linear model is assuming stationarity. And what's fun, this is like MIT just started this new school, right? This new sort of data science school, right? That they get their first, I think it's the first one they're starting like 30, 40 years to raise a billion dollars for this. And one of the things they want people who are bilingual who can communicate between these sort of really sophisticated artificial intelligence models and the real world because the thing is people are afraid of sort of just throwing all this information into this giant AI model that spits something out. But if you're using relatively simple models, you actually can, it is easy to be biased like it's easy to sort of look deeply at this whatever model you've got and say why is the model saying this, right?”
2019-04-02 · The Knowledge Project with Shane Parrish · #55 Scott Page: Becoming a Model Thinker · IDENTIFIED FROM THE TRANSCRIPT
“If they're far apart, if the linear model and the humans are giving very different predictions, then you want to go talk to them. I mean, talk to the people and talk to the linear model. Now, you could say, how do you talk to the linear model? Well, you look and you say, what variables are in there? What variables are the people using that the linear model is not? What are the coefficients look like?”
2019-04-02 · The Knowledge Project with Shane Parrish · #55 Scott Page: Becoming a Model Thinker · IDENTIFIED FROM THE TRANSCRIPT
“Regression because that's sort of like you know a design feature and it wasn't a very attractive printer but the difficulty with data in those situations and the formal the linear model is that it only looks backwards right it can only look at sort of what's happened in the past whereas people when we're constructing models often are kind of forward looking like how are people going to respond to this new design protocol now what's going to work best ironically in all these situations is a combination of the linear model and the model with people. And this gets to this sort of step from knowledge to wisdom that I find really fun. You could say, oh, so what you should do is you should average the linear model and the people. That seems to not be true. What you should do instead is if the linear model of the people are close, the predictions, you probably should go to the linear model because it's really local calibrated, right? It's probably going to be better.”
2019-04-02 · The Knowledge Project with Shane Parrish · #55 Scott Page: Becoming a Model Thinker · IDENTIFIED FROM THE TRANSCRIPT
“Oftentimes, when you have groups of people compete against the linear models, the groups of people can beat the linear models. And when they do, what you find out where they beat them is when the linear model, the person constructing the linear model, because the linear model is actually constructed by some sort of person typically, doesn't have a way of including something in the model. So one example involved a consumer product was a printer. And the linear model said this printer is going to sell, let's say, 400,000 units. The crowd was like, no, it's going to sell like 200,000 units. That was a huge difference. And so they went back and they interrogated people in the crowd saying, why do you think this printer's not going to sell? It's handle suspending pieces of paper. Print quality is this good. The toner cartridge is easy to exchange, all the sort of attributes that were nonlinear. And the first word on the person's mouth was, but ugly. That is a butt ugly printer. Well, there was no but ugly variable.”
2019-04-02 · The Knowledge Project with Shane Parrish · #55 Scott Page: Becoming a Model Thinker · IDENTIFIED FROM THE TRANSCRIPT
“So here's a really great example of that. So this phenomenon called the wisdom of crowds, right, the Sir Wiki book, where you can have groups of people make accurate predictions. Well, the reality is that sometimes groups will be successful and sometimes they won't. And one of the reasons we write down models is to figure out what types of diversity will be used for and what types won't be. But there's been work by a number of people, K at Chen at HP Labs, Michael Fanches Burke at the University of Michigan, where they sort of compared how do you know, sort of suppose I have lots of actual data out there and I run a linear regression to try and predict something. And I have that compete against people. What you find is the regression does a lot.”
2019-04-02 · The Knowledge Project with Shane Parrish · #55 Scott Page: Becoming a Model Thinker · IDENTIFIED FROM THE TRANSCRIPT
“I puzzle over this a lot every time I think I have an accurate view of it, I then reframe how I think about it. So I was giving a talk the other day. And someone said, I think the real space for mental models come in is in this move that's very subtle between data and information, which is true, right? Because when you think about how I might think about, like if I visit a city for the first time and somebody says, you know, tell me about Stockholm, I immediately start putting it in categories. They might say, well, you know, it's a lot like London or something, right? Or you might, you know, you might sort of say, well, the people are friendly but reserved or something. So again, you're taking all these sort of experiences and putting them in boxes. So there is a sense in which just the act of going from your raw experiences into the information, it's almost leaning on the models you already know. And so this is the thing that I've been puzzling over the last few weeks, which has been fun to think about is that if I have a set of like models in my head that we think of it that way.”
2019-04-02 · The Knowledge Project with Shane Parrish · #55 Scott Page: Becoming a Model Thinker · IDENTIFIED FROM THE TRANSCRIPT
“All these ways that people have sort of making sense of the world. And one of the reasons people go to your site, one of the reasons people read business books, one of the reasons read, gather knowledge is to some sense, accumulate knowledge in the form of ways of taking information and understanding relationships to it. And what we hope to gain is wisdom by having more knowledge to draw from. But the point of the sort of core philosophies of the model thinker is even if you do the best you can, even if you're a lifelong learner, even if you're constantly amassing models, you're still not going to be up to the task of solving anyone. You're not going to, you yourself are not going to sort of solve the obesity epidemic. You yourself are not going to sort of, you know, make create world peace. You yourself are not going to sort of solve climate issues. But what it's going to take because you're just not going to, your brain just is going to be big enough. Collections of people by having different.”
2019-04-02 · The Knowledge Project with Shane Parrish · #55 Scott Page: Becoming a Model Thinker · IDENTIFIED FROM THE TRANSCRIPT
“Is a network of loans and deposits across banks and across countries. Another model is just a simple supply and demand model. And so Munger has this wonderful quote about you want to sort of array your experiences on a lattice work of models. And what Eric does in this situation, those are his two models, complicated network of loans and promises to pay and simple supply and demand. And he looked at the person who walked in his office and Iceland is smaller than Fresno, go back to work, right? So that's his experience that it's a tidy country. It's not going to matter very rich. Whereas if the person had walked in his office and had Blackrock just failed, right? He would have said, oh my goodness, I'm not going to use this applying demand model. I'm going to use this networks of contracts and promises to pay model. And so what you want to think about is you as an individual. One of the fabulous things about your site, Farnum Street, is that it's all about all these metal models.”
2019-04-02 · The Knowledge Project with Shane Parrish · #55 Scott Page: Becoming a Model Thinker · IDENTIFIED FROM THE TRANSCRIPT
“If a piece of information is mass and a piece of information is acceleration, then knowledge is that force equals mass times acceleration, right? And if a piece of information is unemployment and a piece of information is inflation, then you might understand that unemployment is very, very low. You often get wage inflation. Again, that's a piece of knowledge. What wisdom is, is wisdom is understanding which knowledge is to bring to bear on a particular problem. And sometimes that can be just selecting among the knowledge. Other times that can be a case where what you're doing is, you know, sort of combining and coalescing the knowledge. Let me give two examples from finance here. One of them that devolves my college roommate, Eric Ball, who is treasured Oracle, and this is one of my favorite stories in the book where he was someone comes into his office and says, Iceland just collapsed. Two models sort of, and the models sort of came in and said, one is you can think of the international financial system.”
2019-04-02 · The Knowledge Project with Shane Parrish · #55 Scott Page: Becoming a Model Thinker · IDENTIFIED FROM THE TRANSCRIPT
“Undergraduates or general audiences, something called the Wisdom Hierarchy. And you want to think at the bottom out there is all this data, right? All this, just whether you want to call it a fire hose of data or a hairball of data, you know, choose your favorite metaphor. It's all just floating out there. On top of the data is information. What information is, is that this isn't something we structure the world. So you may say unemployment is up. What you're doing is shaking tons and tons of data about people having jobs and you're putting that into a single number, you're sort of categorizing both unemployment's up, inflation's up, and you're using those as your variables. Whereas someone else might have a very geographic view of things and say, boy, Los Angeles is doing well, right? And Texas is doing well or something, right? There seems to be, you know, the Midwest, the economy's not doing well. Then what you do on top of information is knowledge. And what knowledge is, is understanding either correlative or causal relationships between those pieces of information, right?”
2019-04-02 · The Knowledge Project with Shane Parrish · #55 Scott Page: Becoming a Model Thinker · IDENTIFIED FROM THE TRANSCRIPT
“It is. I think that this is where I occupy kind of this strange fight against the book I wrote before this was called The Diversity Bonus. And that book talks about the value of having diverse people in the room. And the reason you want diverse people in the room is because different people bring different basic assumptions about how the world works. They construct different mental models of how the world works. And they're going to see different parts of a problem. So if you want to, like just look at this, you know, if you look at sort of fluctuations in the stock market or if you look at the valuation of any particular company, there's so many dimensions to a company like Amazon or Disney, right? That there's no way any one person can understand it. And so what you want is you want cognitive diversity in what that cognitive diversity means is people who have different literally different sets of models or different information. So one of the things that sort of leads off the book, and I use a lot when I teach this to”
2019-04-02 · The Knowledge Project with Shane Parrish · #55 Scott Page: Becoming a Model Thinker · IDENTIFIED FROM THE TRANSCRIPT
“Just sort of, I think, a more holistic approach. We can talk about this later. I think it leads to sort of a different way of thinking about policy when you think about going at these problems from a multiple model perspective”
2019-04-02 · The Knowledge Project with Shane Parrish · #55 Scott Page: Becoming a Model Thinker · IDENTIFIED FROM THE TRANSCRIPT
“Just sheer dimensionality of the world that sits in front of us. But collectively, we can kind of make sense of it. So let's take something outside of finance for a second. Let's look at the obesity epidemic. You could blame that on infrastructure. You could blame it on food. You could blame it on the bacteria in our gut. You could blame it on changes in work-life balance, the lack of physical work, all sorts of things. And to understand any one of the dimensions that contributes to obesity, you'd probably need to have, you know, not necessarily graduate, you'd not necessarily graduate, you might take five, ten years of study to just understand one piece of it. But if you tried to fix the obesity of epidemic by just changing that one piece, by just sort of climbing that one little hill, you're not going to get very far because there's going to be probably systems level feedbacks. And so there's going to be”
2019-04-02 · The Knowledge Project with Shane Parrish · #55 Scott Page: Becoming a Model Thinker · IDENTIFIED FROM THE TRANSCRIPT
“Where the food is, right? So B will come back and dance and say, Look, I think there's food here, and another B will come back and dance and think there's food here. And they can kind of aggregate their sort of crude maps of the world. At the same time, that people were thinking about collective intelligence from a purely theoretical perspective, there was a set of people in computer science who were creating things like random forest algorithms and these giant sort of artificial intelligence algorithms that also were sort of constructing or creating collective intelligence by combining all sorts of very simple filters. And so, and I think you've learned, I think there's sort of a growing consensus that our heads aren't big enough. No individual's head is big enough to sort of make sense of the complexity of the world. So you're going to have a set of models of how you think the world works. I'm going to have a set of models of how I think the world works. But collectively, right, in any one of us, there's just too small to make sense of the craziness, the complexity.”
2019-04-02 · The Knowledge Project with Shane Parrish · #55 Scott Page: Becoming a Model Thinker · IDENTIFIED FROM THE TRANSCRIPT
“Complexity is by throwing ensembles of models at problems. So one of them may explain 20%, another 15%. And it's not that they add up to 100% that they're explaining everything. In fact, if there's overlap, there's even sometimes contradictions in what they might explain and what they might predict. But by looking at the world through an ensemble of logically coherent lenses, you can actually make sense of that complex world. And what's fascinating about this to me is there's a group of people who are some philosophers, some economists, some statisticians, some biologists kind of playing in this space of collective intelligence, right? You might think biologists, what are biologists doing in this space? But if you think of ants, each individual ant has a mental model, so it's a map of the terrain of where the food sources are. And they can sort of aggregate that collectively within the nest. And bees can do the same thing within the hive by doing these things called waggle dances, which sort of explain”
2019-04-02 · The Knowledge Project with Shane Parrish · #55 Scott Page: Becoming a Model Thinker · IDENTIFIED FROM THE TRANSCRIPT
“That group as well. And they were sort of these people who studied rational choice and how do people sort of optimize in social situations. And the Senate Institute was all about the fact that the world was so complex there was going to be hard to optimize. And so I wouldn't say that I had some sort of intellectual crisis. It was more the case intellectually fascinating. There was this disconnect. And the disconnect is that I'm trying to make sense of an extremely complex world using very simple models. And so what social science has done, I think, typically sort of said, okay, the world's really complex, here's my model, and I can explain 30% of the variation. I can explain 10% of the variation, or I can explain why these stocks went up in value or something. But that means you're missing the other 70% or 90%. And so what not me alone, but a bunch of us have kind of happened on is this notion of collective intelligence, is the idea that one way you can make sense of”
2019-04-02 · The Knowledge Project with Shane Parrish · #55 Scott Page: Becoming a Model Thinker · IDENTIFIED FROM THE TRANSCRIPT
“So, what the approach is this, you know, when I was trained in school, I mean, even though starting in sixth, seventh, eighth grade, you learn a bunch of very simple models like force equals mass times acceleration or PV equals k, you know, in physics. And in economics, you learn things like S equals D sub y equals demand. And these models are very simple and sort of the whole idea was I can explain patterns in the real world or I can sort of make sense of the variation we see in the real world using a single simple equation. Then what happened is sometime in about 1990s, I went and visited, at least 1993, I went visited the Santa Fe Institute, which is a think tank on complexity. And this is a place where they've been trying to encourage my advisors at the time who are very good game theorists, that Roger Meyerson won the Nobel Prize in Game Theory, along with Leo Hurwick, who's another Mudvis, and Stan Ryder was.”
2019-04-02 · The Knowledge Project with Shane Parrish · #55 Scott Page: Becoming a Model Thinker · IDENTIFIED FROM THE TRANSCRIPT
“Work experience, maybe personality tests. You have to think about what are the things, the variables that I use to sort of attach reality into connect reality to the sort of mathematical framework that exists out there. So what I try and do in the book, but also in my work, is think about the mathematics is beautiful because it's logical, it's right, right? But reality is kind of messy and confusing and complex. And so what I see mental models in doing in some sense is mapping reality to the sort of clean logical structures of mathematics.”
2019-04-02 · The Knowledge Project with Shane Parrish · #55 Scott Page: Becoming a Model Thinker · IDENTIFIED FROM THE TRANSCRIPT
“So, what a mental model is just a framework that you use to make sense of the world. So what the model thinker is, the book, it's a book that contains really three things. One is sort of a general philosophy of models. One is a collection of models that you can sort of play with and understand. And then a third thing is sort of this, some examples of how one in practice would apply a variety of models to a problem. So when I think about a mental model as opposed to maybe a standard mathematical model is in a mental model, what you have to do is you have to sort of map reality to the mathematics. So I may say, and this would be one thing if someone were to say, well, you should use a linear model here to decide who to hire, right? Take your data and just put it on a linear model. But the thing is, you have to decide what are the variables, right? So, you know, because a linear model contains things like maybe grade point average.”
2019-04-02 · The Knowledge Project with Shane Parrish · #55 Scott Page: Becoming a Model Thinker · IDENTIFIED FROM THE TRANSCRIPT
“You yourself are not going to sort of solve the obesity epidemic. You yourself are not going to sort of create world peace. You yourself are not going to sort of solve climate issues, right? Your brain just is going to be big enough. Collections of people, creating a larger ensemble model actually have a hope of addressing these problems.”
2019-04-02 · The Knowledge Project with Shane Parrish · #55 Scott Page: Becoming a Model Thinker · IDENTIFIED FROM THE TRANSCRIPT